If you are the victim of theft while on holiday you could get as much as four times more by claiming on your home insurance policy rather than your travel insurance.
Most people have no idea that their home contents policy also provides cover for lost or stolen luggage and valuables while on holiday overseas, and use their travel insurance to make a claim instead.
However, travel insurers are typically not generous when it comes to baggage cover and there are often strict limits on the amounts you can claim for baggage, valuables and cash. Also, travel insurance also tends to add deductions for wear and tear of items as well as high policy excess payments.
Recent research carried out by Money Mail found that if a hypothetical couple’s hotel room was robbed and they lost £2,000 worth of personal belongings then the typical travel insurance policy would only pay out £515.
In contrast, a good home contents insurance policy would pay out for the full worth of the lost goods less the average excess of about £100 – so the couple would get £1,900 back. That’s nearly four times as much as from the travel insurer.
This is not to say that it is not worth buying travel insurance, as it is important to still have cover for any medical expenses you may incur while on holiday abroad. Travel insurance can also come to your aid if you have to cancel your holiday or suffer from cancelled/delayed flights and connections.
However, if you have to make a claim for lost or stolen possessions then it is often better to submit your claim through your home insurance company.
Brian Brown, head of insight at data analysts Defaqto, says:
Most travel insurers offer baggage cover because their customers expect to see it but if you are taking anything worth more than a few hundred pounds you could end up seriously out of pocket.
Defaqto’s own research found that nearly half of the 932 travel insurance policies they looked at limit the amount you can claim for lost possessions to just £250. Customers are also nearly always expected to contribute to some part of the claim in the form of an excess payment, which is usually around £75.
So on average the most you will get back is just £175.
Some travel insurance policies are better than others when it comes to the limits you can claim, so as always the best advice is to read the small print and compare the best policies before you buy.